Planning: Functions and Benefits

WHAT IS PLANNING? Planning involves defining the organizations goals, establishing an overall strategy for achieving these goals, and developing a comprehensive set of plans to integrate and coordinate organizational work.

WHY DO MANAGERS PLAN?

Purposes of Planning. Planning is important and serves many significant purposes. 1. Planning gives direction to the organization. 2. Planning reduces the impact of change. 3. Planning establishes a coordinated effort. 4. Planning reduces uncertainty. 5. Planning reduces overlapping and wasteful activities. 6. Planning establishes objectives or standards that are used in controlling.

HOW DO MANAGERS PLAN?

Planning is often called the primary management function because it establishes the basis for all other functions. Planning involves two important elements: goals and plans.

The Role of Goals and Plans in Planning

1. Goalsdesired outcomes for individuals, groups, or entire organizations. 2. Goals are objectivesthe two terms are used interchangeably. 3. Types of goals. a. Stated & b. Real.

1) Stated goals are official statements of what an organization says, and what it wants its various stakeholders to believe, its goals are. 2) Real goals are those that an organization actually purses.

Types of Plans.
Strategic plans apply to the entire organization, establish the organizations overall goals, and seek to position the organization in terms of its environment. Operational plans specify the details of how the overall goals are to be achieved. Long-term plans are plans with a time frame beyond three years. Short-term plans cover one year or less. Specific plans are clearly defined and leave no room for interpretation. Directional plans are flexible plans that set out general guidelines. Single-use plans are one-time plans specifically designed to meet the needs of a unique situation. Standing plans are ongoing plans that provide guidance for activities performed repeatedly and include policies, rules, and procedures.

Types of Plans
Plans can be described by their breadth, time frame, specificity, and frequency of use. a. Breadth: strategic versus operational plans. Strategic plans are those that are organization wide, establish overall objectives, and position an organization in terms of its environment. Operational plans are plans that specify details on how overall objectives are to be achieved.

b. Time frame: short-term versus long-term plans. Short-term plans are plans that cover one year or less. Long-term plans are those that extend beyond three years.

c. Specificity: specific versus directional plans. Specific plans are those that are clearly defined and leave no room for interpretation. Directional plans are flexible plans that set out general guidelines.

Obstacles to planning
exist, but may be countered by organizations. 1. Obstacles to planning threaten the ability of organizations to develop effective plans. a. Plans in a rapidly changing environment require frequent revisions. Manager may resist formalized planning if they believe planning is unnecessary. The pressure of day-to-day responsibilities may keep managers from planning. Managers may be poorly prepared. Staff specialists may come to dominate the planning process

2. Organizations can take steps to reduce the obstacles to planning. a. Top-level managers may demonstrate their support of the planning process. b. A planning staff is a small group of individuals who assist top-level managers in developing the various components of the planning process. This staff should focus on helping rather than taking over the planning process. c. Contingency planning is the development of alternative plans for use in the event that environmental conditions evolve differently than anticipated, rendering original plans unwise or unfeasible.